Squirrel Money P2P

[AndyKiwi]

So loans are always sold at exactly face value ?

It could be hard to sell some loans at face value quickly or at all. Eg 5 years @ 8% when there are alot of new loans going for 8.5 or 9%

What would happen if interest rates rise - you would not be able to sell loans without discounting - which I dont think you can do.

That's right about loans being difficult to sell at lower interest rates. But you never know, someone might not want to waste time in the bidding process and might still buy the loans at a lower rate especially if the bank interest rates are waaay lower. However, the loans with higher interest rates of say 9, 8.9, 8.95 etc could be lapped up in no time.

At least this is a start and a facility to bail out if required. No other company has it yet. So well done Squirrel Money! I am sure improvements will keep coming over time.

[Saamee]

After sending Funds to SM ( from ASB to ASB ) how long before Funds get Credited to your SM Account?

[AndyKiwi]

Any funds sent before 12 midnight are deposited next day early morning.

[Saamee]

Any funds sent before 12 midnight are deposited next day early morning.

Cheers AK - Just sent my first funding across!

[AndyKiwi]

Once the money is deposited in your account, they send out an automated email to let u know.

[Kelvin]

Cheers AK - Just sent my first funding across!

Good luck. A bit of congestion right now with investor funds piling up and not many loans coming through.

[morphs]

Good luck. A bit of congestion right now with investor funds piling up and not many loans coming through.

I've been with Squirrel for a while and so far pretty happy with the way things are going. I have a slight concern that if investor funds are significantly higher than approved loans, they might relax their credit approval standards to get the funds away. I'm not sure if anyone from Squirrel reads this, but if so it would be good to hear how this situation will be handled.

[Kelvin]

I've been with Squirrel for a while and so far pretty happy with the way things are going. I have a slight concern that if investor funds are significantly higher than approved loans, they might relax their credit approval standards to get the funds away. I'm not sure if anyone from Squirrel reads this, but if so it would be good to hear how this situation will be handled.

The interest rates on Squirrel are determined by the market so too many investors and few borrowers means investors bid lower and rates fall to attract borrowers. Opposite happens if too few investors.

The current minimum and maximum rates for 5 year loans are 8% and 9%, perhaps these rates will be adjusted if investor funds keep building up.

[morphs]

The interest rates on Squirrel are determined by the market so too many investors and few borrowers means investors bid lower and rates fall to attract borrowers. Opposite happens if too few investors.

The current minimum and maximum rates for 5 year loans are 8% and 9%, perhaps these rates will be adjusted if investor funds keep building up.

Thanks Kelvin. Yes, I understand that. However, as far as I am aware, the approval of borrowers is not dependent on the market interest rate. We, as investors, have no control over the credit checking process used by Squirrel. That's true for all P2P lenders I guess, but with the other companies investors are taking on the risk of individual loans. In the case of Squirrel, if they were to reduce their credit checking standards to let more potential borrowers through the gate, it could potentially affect the entire loan book. I am not saying that they would do this, just highlighting it as a potential risk.

[kiwi_on_OE]

The interest rates on Squirrel are determined by the market so too many investors and few borrowers means investors bid lower and rates fall to attract borrowers. Opposite happens if too few investors.

One of the reasons I'm not too keen on lenders setting the rate, is that there may be enough people to drive the rate down too low. And as much as I'd like to be, I'm not an expert at determining the appropriate interest rate, so may follow the herd.